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July 27, 1964

to answer for the attorney in fact. By the same token, when the attorney in fact speaks for the offeror in making the sole party in interest statement, he cannot by that act speak for himself in satisfying the requirement of 192.42(e) (4) (i).

The appellant's alternative contention that its reference by serial number embraces both evidence of the authorization of an attorney in fact and his statement of interest is also unacceptable. First, the evidence filed by the appellant on appeal does no more than to show the extent of Woodward's authority to act in oil and gas leasing matters as attorney in fact for the appellant. There is nothing in this document which indicates a current agreement that Woodward was, or was not, to have an interest in any particular lease offers or leases or that the appellant did, or did not, intend to bind itself to refrain from any future action granting or denying to him or to any other person, such interests. Second, the authority of an attorney in fact, once given, may continue unchanged for any length of time and may thus empower the attorney in fact to file many oil and gas lease offers. But it is obvious that the attorney's interest or want of interest in offers and leases of his principal and his lease holdings and the interests and holding of other persons may vary greatly from time to time so that repeated filings of statements which reflect the precise situation which prevails at the time a particular offer is filed may actually be necessary to insure orderly proceedings in a land office. Thus, the appellant did not, in fact, furnish in the evidence of the authority of the attorney in fact the information required in the statements as to interests to be filed by the attorney with the offer, and, even if it had done so in this case, this would not a fford a proper predicate for the establishment of a general rule that the information as to interests contained in a document evidencing a grant of authority to an attorney in fact will meet the requirements of 192.42(e) (4) (i) while such document remains on file.

Accordingly, I find that the appellant's offer was properly rejected because the attorney in fact did not file the required statements reflecting his own interest or want of interest in the lease offer and the lease, if issued, and, if necessary, his qualifications to hold a lease. Charles B. Gonsales, 69 I.D. 236 (1962); Evelyn R. Robertson et al., A-29251 (March 21, 1963); United States Smelting Refining and Mining Company, A-29201 (April 23, 1963).

Therefore, pursuant to the authority delegated to the Solicitor by the Secretary of the Interior (210 DM 2.21()(a); 24 F.R. 1348), the decision appealed from is affirmed as modified.

ERNEST F. Hom.
Assistant Solicitor.

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RICHFIELD OIL CORPORATION

SHELL OIL COMPANY

A-30154
A-30223

Decided July 30, 1964

Alaska: Oil and Gas Leases-Oil and Gas Leases: Assignments or Trans

fers—Oil and Gas Leases: Extensions-Oil and Gas Leases: Rentals Section 10 of the act of July 3, 1958, amending the Alaska Oil Proviso of

the Mineral Leasing Act of 1920 to require rentals for noncompetitive oil and gas leases in Alaska to be the same as similar leases for lands elsewhere in the United States, is not applicable to leases which had been granted 5-year extensions prior to the act as to the remainder of their extended term, including a 2-year extension resulting from segregation of the lease by partial assignment under section 30(a) of the Mineral Leasing Act, as amended.

Accounts: Refunds-Oil and Gas Leases: Rentals
If there are applicable funds available, refund may be made of oil and gas

lease rentals paid in excess of that required under the lease and applicable statutes and regulations.

APPEALS FROM THE BUREAU OF LAND MANAGEMENT

The Richfield Oil Corporation and the Shell Oil Company (hereafter referred to as "Richfield" and "Shell," respectively) have filed separate appeals to the Secretary of the Interior from separate decisions by the Division of Appeals, Bureau of Land Management, dated September 16, 1963, and December 2, 1963, respectively, affirming Anchorage land office decisions which denied their applications for repayment of rentals allegedly paid in excess for noncompetitive oil and gas leases in Alaska and dismissed their protests against the rental rate for the 11th and 12th years of the leases.

From the Bureau decisions and information given by Richfield, it appears that the oil and gas leases in question in its appeal all originally issued for 5-year terms in 1950 or 1951. The leases with which Shell is concerned in its appeal all issued originally for 5-year terms in 1951 or 1952.2

1 Richfield's appeal comes to this office without any of the lease records. The statements made in this decision and conclusions reached are premised upon the facts as given in the Bureau decision and by Richfield. Richfield lists the Anchorage serial number and effective date of the leases as follows: 011257, 011260, 011293, and 011294 (July 1, 1950); 011259 (September 1, 1950); 011258 and 011295 (November 1, 1950) ; 011261 (March 1, 1951); 011262, 011288, 11290, 011291, 011292, 011302, and 011303 (June 1, 011287 (November 1, 1951). The leases when segregated by partial assignment bore as to the segregated portion the same serial number with the addition of the letter "A" following it.

? These lea ses by their Anchorage serial number and effective date are: 08821 and 08999 (December 1, 1951); 018364 (January 1, 1952); 018365-A, segregated from 018365 (January 1, 1952).

July 30, 1964 At the end of the primary 5-year term of the leases, they were all extended for another 5-year term. During the 10th year of the leases partial assignments were approved by the Bureau of Land Management and the leases were segregated as to the lands which had been assigned. With the approval of the assignments, the Bureau of Land Management recognized that all the leases were extended for an additional two years pursuant to section 30(a) of the Mineral Leasing Act, as amended by the act of July 29, 1954, 68 Stat. 585, which provided in pertinent part as follows:

Assignments under this section may also be made of parts of leases which are in their extended term because of any provision of this Act. The segregated lease of any undeveloped lands shall continue in full force and effect for two years and so long thereafter as oil or gas is produced in paying quantities.*

Both Richfield and Shell raised the question in the land office as to the proper rental for the 11th and 12th years of the leases, the additional 2-year extension provided by the above-quoted statutory provision. During the 5-year extended terms of the leases, the 6th through the 10th years, rental had been paid at the rate of 25 cents per acre a year. For the 11th and 12th years, however, rental was paid, apparently under protest, at the rate of 50 cents per acre a year. Richfield and Shell request a refund for rentals paid in excess, alleging that a rental of only 25 cents per acre was required for the 11th and 12th years and that there is no provision of the law or regulations which requires or which can be validly construed as requiring a greater rental for those two years than for the 6th through the 10th years.

The authority to issue leases for oil and gas in Alaska and to establish rentals and royalties for such leases was granted to the Secretary of the Interior by the so-called “Alaska Oil Proviso," section 22 of the Mineral Leasing Act of February 25, 1920, 41 Stat. 446. This section provided that rental and royalties for leases in Alaska under that act "shall be fixed by the Secretary of the Interior and specified in the lease.” The Secretary was authorized in his discretion to waive the payment of any rental or royalty not exceeding the first five years of any lease for the purpose of encouraging production of petroleum products in Alaska. Under the authority of this act, the Secretary had provided in the requisite lease forms of the Department and by departmental regulation (43 CFR, 1954 rev., 192.80(a)) an annual rental rate of 25 cents per acre for the sixth and succeeding years of a

% This section was further amended by section 6 of the act of September 2, 1960, 74 Stat. 790 ; 30 U.S.C. § 187a (Supp. V, 1964), expressly making the 2-year extension resulting from segregation by partial assignment inapplicable to leases issued after September 2, 1960, unless the lease was held beyond its primary term by production or the payment of compensatory royalty. The 1960 amendment is not applicable, therefore, to the leases involved here as they were issued prior to the date of that act.

noncompetitive lease outside of a known geologic structure in Alaska, although the prescribed annual rental rate elsewhere in the United States as to such leases for the sixth and succeeding years was 50 cents per acre.

In concluding that 50 cents per acre was the proper rental rate for the 11th and 12th years of the leases, the Bureau decisions held that these leases were subject to the same rental rates as leases elsewhere for those two years because of an amendment to section 22 of the Mineral Leasing Act. This amendment, made by section 10 of the act of July 3, 1958, 72 Stat. 324; 30 U.S.C. § 251 (1958), provides in pertinent part as follows:

*** Provided, That the annual lease rentals for lands in the Territory of Alaska not within any known geological structure of a producing oil or gas field and the royalty payments from production of oil or gas sold or removed from such lands shall be identical with those prescribed for such leases covering similar lands in the States of the United States, except that leases which may issue pursuant to applications or offers to lease such lands, which applications or offers were filed prior to and were pending on May 3, 1958, shall require the payment of 25 cents per acre as lease rental for the first year of such leases; but the aforesaid exception shall not apply in any way to royalties to be required under leases which may issue pursuant to offers or applications filed prior to May 3, 1958.

The Secretary of the Interior shall neither prescribe nor approve any cooperative or unit plan of development or operation nor any operating, drilling, or development contract establishing different royalty or rental rates for Alaska lands than for similar lands within the States of the United States. In applying this provision requiring rentals to be identical with those prescribed for leases in the “States of the United States," the Bureau relied upon the following statement from the Senate Committee on Interior and Insular Affairs' report on the bill which was subsequently enacted as the July 3, 1958, act (S. Rep. No. 1720, 85th Cong., 2d sess. 7 (1958)): Those who have leases in effect as of the date of the act would be entitled to maintain their leases at the previous rental and royalty figure during the original term of the lease. However, the amendment causes a change in the rules and regulations; so any ertended term hereafter granted on such existing leases will be subject to the increased rental and royalty figure. (Italics supplied.)

Both appellants object to the Bureau's reliance on the quotation from the Senate report, especially the italicized phrase, but for varying reasons. Shell contends that the report should not be considered at all because the general rule is that reports and other matters of legislative history used as aids in construing a statute should not be considered where the language of the statute is plain and unambiguous. It contends that there is no ambiguity or uncertainty in the statutory language here. It points out that the statute uses the word “shall” and asserts that the common and ordinary usage of that word always

July 30, 1964

refers to the future. It contends that there is nothing in the statute to indicate an intent that it should be applied retroactively to leases issued prior to its enactment, and that retrospective construction of the 1958 act is inconsistent with the general policy of Congress in its various amendments of the Mineral Leasing Act to protect rights previously granted lessees under existing leases. It contends that the act of July 3, 1958, would be unconstitutional if interpreted to apply retrospectively to leases issued prior to its enactment and, therefore, should be construed to sustain its constitutionality.

Richfield does not object to consideration of the Senate report but seeks to make a distinction between the type of extension it contends was contemplated in the italicized phrase of the quotation above and that resulting from the partial assignment of the lease in its extended term pursuant to section 30(a) of the Mineral Leasing Act, as provided in the act of July 29, 1954. It contends that the 2-year period following the 10th year of the leases involved here was not an extended term which was "granted" in the sense that the language of the committee report uses that term. It states that under the July 29, 1954, amendment of section 30(a) the leases were automatically "continued" by the partial assignments in the 10th year by the mere act of the lessee's making the assignments. It notes that under that provision there is no language making the continuation of the lease for the 2-year period subject to existing rules and regulations. It contrasts this with the statutory provisions authorizing 5-year extensions beyond the original 5-year lease terms, where there is express statutory language to the effect that the renewed or extended leases will be subject to rules and regulations in effect at the end of the 5-year primary term of the lease, section 17 of the Mineral Leasing Act of 1920, as amended by the act of August 8, 1946, 60 Stat. 951, and the act of July 29, 1954, 68 Stat. 584; 30 U.S.C. $ 226 (1958). It states that the quotation from the Senate committee report refers to these 5-year extensions where leases are subject to changes in the rules and regulations under these acts and not to other extensions or continuations where there is no such express statutory language.

Richfield has submitted copies of two letters by the Associate Solicitor for Public Lands and the Acting Associate Solicitor for Public Lands, respectively, making a similar distinction between the 5-year extention under section 17 and certain other extensions, which need not be mentioned here, and concluding that the rental rates in effect when the lease issued governed rather than those necessary under the 1958 act amending the Alaska Oil Proviso. The same rationale was given in the letters as that made by Richfield, that there were no

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